Malta attractiveness survey 2016

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Malta

Attractiveness survey 2016

Between the helicopter and the telescope

Let’s start with the bottom line: Malta remains attractive to foreign investors. Indeed, this year’s scores are the highest in the last three years. Yet, this helicopter view hides significant shifts on the ground, which cannot be ignored. To get the full picture, we need to install a telescope on the helicopter.

On the positive side, our tax regime remains attractive and has now been rated as the strongest factor luring foreign investment. However, it might be wise to sound a note of caution on this.

On the negative side, the stability of both our social climate and that of the political and legal environment has taken a knock. While in comparison with other countries Malta still scores highly on these benchmarks, the dip is significant. For an island with no natural resources and whose chances to sink or swim depend only on its people, its geographic location and EU membership, this is worrying.

Turning to another benchmark, current investors believe that while Malta’s innovation environment remains weak it has made significant strides forward. Simultaneously, there is a recurring and growing perception that its transport and logistics infrastructure deters investment.

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EY – 2016 Malta attractiveness survey - Ronald A. Attard

Ronald A. Attard
Country Managing Partner,
Ernst & Young Limited

EY – 2016 Malta attractiveness survey - Honorary Joseph Muscat

Honorary Joseph Muscat
Prime Minister of Malta

"There is one observation about Malta’s current economic success and growth that is crystal clear - neither come about by chance."

Read viewpoint of Honorary Joseph Muscat, Prime Minister of Malta

A destination for investment

There is one observation about Malta’s current economic success and growth that is crystal clear - neither come about by chance.

Over the past three years, this government has taken complex, and necessary, decisions to improve our economic situation. In 2012, our economy was growing at a rate of less than 2% which was far from ideal. By 2015, we tripled growth to 6.3%.

In 2013 unemployment was on the increase, hitting 8,000 at the start of this legislature. Presently, we not only boast a decrease of nearly 5,000 people who are in employment, but we also have the lowest youth, and overall unemployment rate in the European Union.

A growing economy and workforce do not materialize out of thin air. Once a problem is identified, it takes time, investment, and a dedicated team to start resolve it. We inherited a country that was yearning for a change in direction, and for decisions to be taken at the pace which our businesses expected. Productivity, like success, does not happen by chance. Peak productivity is a result of effective-decision making, a necessary tool to achieve the results that we did.

EY – 2016 Malta attractiveness survey - Honorary Joseph Muscat

Honorary Joseph Muscat
Prime Minister of Malta

Despite such positive achievements, I still have words of warning to everyone. We cannot take anything for granted. Sustaining it requires competent people who are bold enough to take decisions in a timely and effective manner. Long-term success also requires perseverance and consistency. Changing direction now would end the momentum gathered in the past few years.

For this reason, we are not just working to sustain existing economic niches, but also widening Malta’s horizons and reach. We have seen unprecedented investment to Malta from around the globe. From China and Singapore, Jordan to Israel, from Germany, the UK and the US.

New sectors to attract foreign investment such as energy, healthcare, education and logistics are not only contributing to Malta’s economy, but more importantly providing more, and better, quality jobs for all. This is all part of Malta’s new journey to make it the best in Europe. A country worth investing in.

We are investing in our people’s ideas; we have made it simpler to start a business by reviewing the bureaucratic processes that were in place, so that more citizens can fulfill their entrepreneurial ambitions. We are taking the country in the right direction and we do not intend to change it.

There is still a lot more to be done and our intent is to spend less time discussing what could have been and more time getting it done.

Now is the time to work hard, to continue creating a welcoming business environment in Malta by ensuring there is growth and stability to attract further investments. I am proud of what we achieved so far and I look forward to seeing Malta continue to develop and to see more businesses choosing to invest here because of the opportunities and possibilities we create.

87%

of respondents find Malta attractive for FDI.

Investor confidence in Malta remains strong

Foreign investors’ confidence in Malta is strong. An overwhelming majority think that the country is currently attractive for FDI, and more than half believe that it will remain so in the near future. Expansions and a long-term presence in the country are envisaged by a majority of current FDIs.

Malta’s access to the EU market, the relative stability of its political and economic environment, its skilled, English-speaking labor force and its attractive fiscal regime are key features that continue to be highlighted by many respondents.

The attractiveness scoreboard highlights the parameters that investors deem attractive or otherwise. Changes in scoreboard placings from last year’s survey results have occurred, but the three most attractive and unattractive FDI parameters remained unchanged.

Malta’s attractiveness for FDI

EY - 2016 Malta attractiveness survey - Malta’s attractiveness for FDI

Strengths: Malta's most attractive FDI parameters

EY - 2016 Malta attractiveness survey - Strengths: Malta's most attractive FDI parameters